Business Ethics and Catholic Identity: The Nike Contract with St. John's

by John R.Wilcox

This article first appeared in the March 1999 issue of Catholic Practice, the E-Magazine of PastoraLink, which is no longer online.

Does being a Catholic make any difference when it comes to making moral choices in business, in fields such as accounting, advertising, computer information systems, finance, management, or marketing? Guidance for Catholics in this area of the moral life is murky or very general at best. The Sunday pulpit is usually not the appropriate venue for reflection on these issues since the congregation is so diverse. Moreover, most of the articles on business ethics are written by individuals who rely on the great Western philosophical tradition going back to Plato and Aristotle. In this important part of Western thinking, great attention is paid to consequences, duties, character, and the virtues. As a result, it is rare that the religious traditions of the West are brought to bear on business ethics.

Business ethics articles, written with philosophy in mind, make great use of case studies. This method provides rich opportunities for discussion. This is especially true of the high-profile case studies such as the Exxon Valdez or the Ford Pinto.

But I must confess that for me there has always been something missing in discussions of both the high-profile cases as well as the more mundane ones. I believe the lack of vitality in these cases had to do with the separating out of my own religious convictions about the moral life when it came to calculating courses of action in moral dilemmas. The separating out was due to sensitivity concerning the religious views/nonviews of others and just not wanting to be overt about religion and applied or professional ethics. My hunch is that I am not the only Catholic who feels this way about the relationship between business decisions and the rich tradition of moral reflection in the Church.

This column offers an opportunity to present a series of cases and then to ask the question: what difference does it make that I am a Catholic addressing a particular problem or dilemma? I do not have a set of answers ready to solve the problem, but I do want to offer reflections born of faith and invite the reader/viewer to join in an on-line conversation. The attempt must be made, otherwise the Catholic moral life is truly privatized, an individual affair with no social ramifications.

Let me begin by recounting the facts in a case recently reported in The New York Times. An article by David Gonzalez, entitled God and Swoosh at St. John's (B1, 9/16/98), raises a number of issues which directly address the subject of Catholic business ethics. In this article Gonzalez describes the dilemma which James Keady faced in his role as a graduate assistant coach for St. John's championship soccer team. A graduate student, Mr. Keady was also studying theology at the University and developed a term paper on sports and social justice. The topic addressed outsourcing of contracts by Nike to Asian factories and the charge of unsafe conditions against the company.

The term paper, however, was not an academic exercise since the University was in negotiations with Nike for a sponsorship contract. Should a Catholic university, proud of its religious identity and advertised as such in its admissions literature, associate itself with a large multinational corporation whose outsourcing contracts generate enormous revenue while employing "factory workers hired by subcontractors scraping by on what human rights advocates call starvation wages."

Mr. Keady's dilemma was that the term paper had a real-life quality. He valued Catholic social teaching that clearly supports the poorest members of society through the principle of a "fundamental option for the poor". The value would be a value in words only unless he acted on the value. Gonzalez notes that Mr. Keady found further support for his valuing of Catholic social teaching in the writings of Mahatma Gandhi, the Indian activist. "I'm a student of Mahatma Gandhi and he said resistance needs to be public and provocative if it is going to effect change." In good conscience this coach could not wear the Nike logo. According to Mr. Keady, his superior, who at first thought he was satisfied with the University's position on Nike, told him to wear Nike or resign. (Keady's superior says he never gave him an ultimatum.) He did resign for a teaching position at a Catholic high school, but caught University officials and coaches by surprise because of his reasoning.

James Keady's position and action were the result of a journey of discernment. Once it became clear to him that Nike workers in Asia were not paid a living wage and were not allowed to organize unions, his dilemma was resolved and he resigned. St. John's University administrators noted their own concerns with Nike but preferred a path somewhat different-to continue the relationship but try to change Nike's policies. St. John's will place demands for change in its contract negotiations and withdraw if Nike does not abide by conditions such as independent monitoring of factories and "verifiable assurances of fair treatment". Some of Mr. Keady's friends, Gonzalez concluded, are puzzled. One said he screwed up and should get over it. Mr. Keady responded quite simply: "there are more important things than games."

This case contains many of the issues being addressed by professors who teach business ethics within a philosophical framework as well as by ethicists and compliance officers who work in the private sector or for public sector institutions, such as the United States Government or agencies of the United Nations. It is also a fitting point of departure for a discussion of Catholic business ethics, which depends very heavily on the tradition of Catholic social thought as well as the Western heritage of philosophical ethics.

For me, philosophical ethics will present clear and persuasive arguments in favor of the Asian workers, arguments which may lead to actions such as boycotts of Nike products, shareholder resolutions, lobbying of politicians to bring public policy inline with principles of justice. Persuasiveness arises from the logic of arguments such as treating people as ends and no simply as means to an end, as in Immanuel Kant's reasoning, or concern for those who are least advantaged in society as in John Rawls' writings. What I find missing, however, is the lack of passion in such arguments and what appears to be an "objectivist" analysis. The Nike problem can indeed be analyzed from several philosophical points of view, even from the point of view of what is in Nike's self interest. Pull the case apart, put it back together and produce a carefully reasoned response. Where are the sparks of engagement or the warmth of passion, which comes from the realization that this case is about me?

Philosophical analysis is not the same as the passion of a personal God, whose concerns must be our concerns. If there is no real relationship between me and the Asian worker, why should I care? Philosophy lead me to assent to the fact of injustice, but, unfortunately, does not impel me, as my Catholicism does, to act on the injustice as a personal responsibility. Having said this, I hesitate to go further, because I know that some of the most passionate defenders of the poor and the outcasts are alienated from, if not very suspicious of religion. Hasn't this been the great stumbling stone and scandal of religion: that those who are often so devout in church are morally callous in the workplace?

David Gonzalez's article about James Keady is provocative because it speaks to the need for convergence of my relationship to God and God's relationship to the most vulnerable members of the human community. It is a wake up call for me to attend to my consumerist shopping habits and the insularity of my little world. At the same time, there are some hard questions in this "swoosh" case. Mr. Keady came to the conclusion that he had to resign because of the contract between Nike and St. John's. The University, on the other hand, said it was sensitive to the issue and would take another tack: monitor Nike and get them to change. As an institution, it might be easier for St. John's to effect that change than it would be for the assistant soccer coach to bring about the change. There is more bang to St. John's buck. But it is also true that St. John's has a lot to gain from the Nike sponsorship and is not a disinterested party. It has a serious obligation to follow up on Nike and to be willing to cancel the contract if there is no change. As an individual Catholic, James Keady felt he had no choice but to take a public stand and resign. Should he have been satisfied with the University's decision? Would that have been sufficient to salve his conscience or did the Gospel demand more? Would it demand the same of all Catholics or is Jim on the fringe, just a little odd in his approach to the Catholic moral life? There are at least four moralities in this case: James Keady's responsibility, that of the University, the policies of market-oriented consumer countries toward outsourcing in the other two-thirds of the world, and the responsibilities of the elites in those destitute lands who welcome manufacturers seeking the cheapest labor pools. In this column, I have only discussed the responsibilities of two moralities: that of an individual Catholic and that of a Catholic institution, both acting on principles of Catholic social thought, but coming up with very different solutions. Is Keady a prophetic voice crying into the winds of the wilderness and wasting his time, or is St. John's University the savvy voice of institutional Catholicism doing battle with the evils of capitalism? What do you think?

John R. Wilcox is the director for the Center for Professional Ethics and chair of Religious Studies at Manhattan College, Bronx, NY 10471.